Share this content
5

Capital allowance on vehicle

Can balancing allowance be claimed on car used partly for business

Didn't find your answer?

Client has used personal car in business, only business use proportion has been claimed every year in capital allowances, depending on business miles details provided by client. Client has now sold car, not replaced it, and there was no business use in the year of sale. There is a balancing amount left in capital allowance calculations but as no business use in the year can this be claimed in full?

Replies (5)

Please login or register to join the discussion.

By johngroganjga
18th Jul 2019 11:44

If there was no business use in the year, the private use deduction will be 100% won’t it? What logic leads you to the conclusion that it might be 0%?

Thanks (0)
By Red Leader
18th Jul 2019 11:56

Assume unincorporated business.
Does the balance get transferred to the general pool as there is no private use?

Thanks (0)
Replying to Red Leader:
avatar
By Vile Nortin Naipaan
18th Jul 2019 12:08

All of the use is now private. There is no business use in the final period.

Thanks (0)
avatar
By Vile Nortin Naipaan
18th Jul 2019 12:09

And the correct answer, subject to the application of s 208, can be found in the fifth paragraph, here:

https://www.gov.uk/hmrc-internal-manuals/capital-allowances-manual/ca27005

S. 208 is unlikely to apply in relation to a car, due to s 208(1)(d).

Thanks (1)
Replying to Vile Nortin Naipaan:
avatar
By jcace
18th Jul 2019 12:25

With the key words being "reflect the degree of non-qualifying activity use (and so the restriction of the allowances) over the period of ownership" i.e. not just the final accounting period.

Thanks (1)
Share this content